When this year’s tax season began in late January, it was reported that the Internal Revenue Service (IRS) had a backlog of twenty-four million unprocessed returns and correspondence from previous years.
But on Thursday, IRS Commissioner Chuck Rettig gave the House Ways and Means Committee and the general public some much-needed good news. Rettig foresees the beleaguered tax agency clearing its massive backlog “absolutely before December.”
“As of today, barring any unforeseen circumstances, if the world stays as it is today, we will be what we call ‘healthy’ by the end of calendar year 2022, and enter the 2023 filing season with normal inventories,” he continued.
Rettig’s assurance to Congress that the agency is making headway comes days after the IRS announced plans to hire a total of 10,000 new employees to tackle the backlog. With job fairs already lined up, the agency is anticipating hiring 5,000 workers in the coming months and filling the other 5,000 positions next year.
The IRS also is creating another so-called “surge team” to process new returns. “IRS employees have been working tirelessly to process backlogged returns and taxpayer correspondence,” Rettig said in a recent statement. “To ensure inventory is back to a healthy level for next filing season, we are leaving no stone unturned—taking an all hands on deck approach to ensure as many employees as possible are dedicating time to return processing,” he added.
IRS officials have blamed the backlog on several factors. Rettig previously noted that the agency is grossly understaffed, leaving the IRS with 20,000 fewer workers than it had in 2010. Moreover, the agency is trying to make do with a budget of roughly $11.4 billion, which is 20 percent less than what it was in 2010, according to the Congressional Budget Office.
At the same time, the agency has had to implement multiple revisions to the tax code. Moreover, it had to process three rounds of government-issued direct stimulus payments that were sent to millions of Americans over the past two years.
More IRS Funding
President Joe Biden has proposed pumping $80 billion into the agency over the next decade to help with the budget shortfalls. And more recently, Biden signed off on providing nearly $12.6 billion in funding for the IRS through September.
However, some Republicans aren’t on board with the White House’s plans. One such individual is Sen. Rick Scott (R-Florida), who has proposed cutting the IRS budget in half. Rettig responded by saying that such extreme cuts would cripple the agency. “If the IRS budget was cut by 50 percent, you might be better off and save more money by just shutting it down completely,” he said.
“We account for 96 percent of the gross revenue of the United States of America. How are you going to fund what we need to fund and what every American deserves? … Cutting our budget is not the right answer,” he continued.
Ethen Kim Lieser is a Washington state-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.